Taking into account the PZU Group’s operations in the insurance sector (in Poland, the Baltic Countries and Ukraine), as well as in the investment, old-age pension, healthcare and banking sectors, the main external factors affecting its operations in the short term (up to 1 year) and medium term (1 to 5 years) can be divided into three categories: macroeconomic and geopolitical, legal and regulatory, as well as segment-specific. The Group’s operations are also influenced by internal factors determining the pace of its development, operational efficiency, and the achievement of strategic goals.

Macroeconomic and geopolitical factors

The growth rate, level and structure of the key macroeconomic factors in Poland and abroad (GDP, inflation, interest rates) translate into the growth rate of business in all sectors in which the PZU Group operates and their profitability. They determine, directly or indirectly, albeit with a certain time lag, the gross written premium growth rate and insurance revenue in non-life insurance, as well as changes in demand for credit and accumulation of deposits, and inflow of assets into funds. Moreover, they influence the claims ratio in non-life insurance and the investment result. They also shape the fund management fee results and key measures that affect the performance of the banking sector (net interest margin and costs of risk).

In particular, inflation is a factor that strongly affects the insurance business. It raises amounts claimed, costs of claims handling, and costs of business. It also generates a problem for clients related to the depreciation of insurance benefits in long-term products, significantly reduces the real value of life policies and erodes the guaranteed sum in third-party liability insurance (e.g. D&O policies). Inflation and high costs may bring about the risk of underinsurance, present when the declared value of assets (such as movable and immovable property and content thereof) and risks are lower than in reality. When underinsurance arises, the insurer may accordingly diminish the sum they are obliged to pay, accounting for the ratio between the insurance value and the real value of the assets lost. As a consequence, the compensation paid out might not be enough to cover the real costs of restoring the assets insured. This is a particularly significant risk for corporate insurance, which may hinder the restoration of business and cause liquidity and stability problems for enterprises.

GDP growth translates into individual consumption and domestic demand, and therefore also into spending by households and the corporate sector on the purchase of insurance policies, the sale of loans and related insurance for borrowers. Here, inflation has the inverse effect, affecting real household income, among other things. A slowdown in economic growth generally leads to a deceleration in the growth rate for gross written premiums in non-life insurance, a decline in the demand for life insurance as well as subscriptions and health insurance, particularly within the framework of perks offered by companies. Poorer financial standing of companies and households may result in an increase in credit risk (in particular in the banking segment) and higher loss ratio on the financial insurance portfolio, weakening of the growth rate of new mortgage loans and a weaker growth rate of consumer loans. In addition, rising unemployment and lower employment may also lead to an increase in extortion and insurance crimes.

In 2026, the expected acceleration of key economic projects, including investments related to the energy transition – such as the construction of nuclear power plants, the development of offshore wind farms – and the intensification of work on transportation infrastructure, including the modernization of the rail network and the development of airports, may create good conditions for the development of construction insurance, third-party liability insurance, transport insurance, and insurance guarantees.

The economic environment, in particular the actions of the Monetary Policy Council with respect to interest rates and the reserve requirement, play a key role in the functioning of the banking sector. A very low interest rate environment has a negative effect on the sector’s performance (by affecting the banks’ net interest income), which could be felt particularly in 2021. An increase in market interest rates, on the one hand, contributes to financial stability, as it promotes improvements in the profitability and financial position of banks and insurers, but on the other hand, it carries risks to financial stability, as it may contribute to a deterioration in the quality of banks’ loan portfolios. Higher yields on bonds measured at arm’s length in portfolios of banks and insurers involve a reduction in their nominal value. The effect for insurance companies of this matter depends on the difference between the duration of assets and equity and liabilities. Furthermore, administrative solutions aimed at lowering the cost of rising interest rates for households (so called moratorium periods) limit the profit of the banking sector.

Tensions remain high in global geopolitics. The armed conflict between Russia and Ukraine, despite attempts to bring it to an end, is still ongoing, with great uncertainty about the possibility and timing of a lasting peace agreement. Things continue to be on a knife’s edge in the Middle East (with a new wave of protests in Iran late last year and the resulting increase in the U.S. military presence in the region). The beginning of 2026 saw the Donald Trump administration making strong demands for Greenland, increasing tensions with the EU. The potential escalation in the aforementioned areas could generate shocks to the global economy that are difficult to predict, and destabilize financial and commodity markets. On top of that, it is worth mentioning possible tensions related to elections scheduled for 2026 (including the Hungarian parliamentary elections in April, and the Danish elections in October, as well as snap parliamentary and presidential elections in Bulgaria, snap elections in Japan and the U.S. midterms in early November).

The key macroeconomic risks in 2026 are now related to economic activity in Poland’s external environment. Problems with the competitiveness of the European economy, as well as the direction which the Trump administration is taking in its decisions, with the possible tensions caused by it, may more strongly limit the growth prospects of the Old Continent. Weaker GDP growth rate among Poland’s trading partners may in effect mean slower GDP growth than expected in Poland. In turn, increased infrastructure and armaments spending announced in Germany, as well as the loosening of fiscal rules by the EC to increase military spending in the EU, may work towards improving the country’s growth prospects. Poland also still has a sizable amount of European funds to draw on, the growing inflow of which into the real economy should mitigate the negative effects of external shocks.

Data for the Polish economy

2022 2023 2024 2025 2026*
Real GDP growth in % (y/y) 5.3 0.2 3.0 3.6 3.6
Household sector consumption growth in % (y/y) 5.0 (0.3) 2.9 3.7 3.8
Growth in gross fixed capital formation in % (y/y) 1.7 12.7 (0.9) 4.2 8.1
Consumer price growth in % (y/y, annual average) 14.4 11.4 3.6 3.6 2.3
Nominal wage growth in the national economy in % (y/y) 12.0 13.1 13.3 9.1* 6.2
Unemployment rate in % (end of period) 5.2 5.1 5.1 5.7 5.4
NBP base rate in % (end of period) 6.75 5.75 5.75 4.00 3.50
*Preliminary Statistic Poland data.
**Forecastof the PZU Department of Macroeconomic Analyses as of 18February 2026.
Source: Statistics Poland/PZU Department of Macroeconomic Analyses

Nowadays, among the factors of macroeconomic risk, attention is increasingly drawn to the rapidly growing debt and government deficits that remain at relatively high levels, including in Poland and other EU countries. The debt increment comes at a time when large expenditures are needed for the digital and energy transformations, as well as defense spending. Fiscal tensions may increase pressure on currency and bond valuations.

The risks associated with the development of artificial intelligence (AI) are also generating more and more discussion globally. While it is likely that the associated productivity benefits of AI to the global economy will be tangible, there is increasing talk about the low rate of return on investment in AI, especially when one considers the enormous costs that must be incurred in the infrastructure required to use it effectively (e.g., data centers, chips, energy). Research related to AI’s impact on the labor market is also inconclusive. Strong global growth in AI technology investments is generating an investment boom, especially in the U.S. and Asia; the EU is less dynamic and thus risks losing competitiveness. A sudden correction in the valuation of technology company stocks with a high concentration in this area could have wide-ranging implications, including for macroeconomic stability.

The PZU Group’s activities are materially subject to the impact of both national regulations and European legislation.

Legal and regulatory factors can significantly affect the PZU Group, determining the manner in which it conducts business, the scope of its reporting obligations, the level of its capital requirements or the intensity of supervision of the financial and insurance markets. The dynamically changing regulatory environment – in Poland and the European Union – requires continuous adjustment of operational processes, reporting systems and risk management mechanisms. This translates directly into an increase in operating costs and affects the Group’s strategic decisions.

In 2026, the Polish financial sector will operate in a regulatory environment characterized by increasing complexity, intensive harmonization at the EU level, and a strong supervisory focus on the quality of practices towards customers, cyber-resilience and countering legal risks.

PZU faces the challenge of comprehensively implementing a new generation of regulations related to sustainable finance. At the same time, supervisory demands on the insurance sector are growing, including in the area of risk management, regulatory reporting and customer protection. These changes increase operational, technological and cost pressures, but at the same time are conducive to strengthening the PZU Group’s transparency and resilience to future risks.

In addition, significant regulatory challenges affect the banks that make up the PZU Group. The banking sector is at the heart of a drive to intensify requirements in areas such as capital adequacy (including the CRR/CRD package), credit and operational risk management, mortgage regulation and growing ESG disclosure obligations. Under these requirements, banks have to make significant investments in reporting systems, risk models and cybersecurity, which translates into rising compliance costs and the need to further optimize processes.

In the insurance area, progress in implementing the broad package of EU reforms and national supervisory priorities set by the KNF will be key. These regulations are aimed at strengthening the financial resilience of establishments, improving the quality of customer relations, increasing product transparency and building modern standards for operational resilience. At the same time, growing climate and geopolitical risks are becoming a key area of supervisory focus, and so there is a need to modernize risk models and update solvency strategies. These changes are bringing about a complex regulatory environment in which insurers must simultaneously implement numerous adjustment projects involving governance as well as operational and technological processes.

In 2026, the KNF identifies four strategic areas for supervision: solvency of establishments in the light of climate, geopolitical and demographic changes; enhancement of product quality and customer service; improvement of the quality of distribution of insurance products; and adaptation of supervision to new regulatory requirements. There is a particular focus on catastrophic risks and the insurance gap, particularly in the property insurance segment, where the KNF has announced further recommendations on distribution quality. The KNF aims to increase the stability of the sector and improve the quality of the customer experience, including product with respect to transparency and claims handling efficiency.

The implementation of the IRRD and of the update to Solvency II is one of the most important regulatory challenges of 2026. Implementation of the IRRD requires companies to develop detailed recovery plans and resolution procedures, significantly raising standards for emergency preparedness. Changes to Solvency II strengthen requirements for transparency, capital adequacy and quality of reserve management, forcing a more conservative approach to risk assessment. These changes support the long-term sustainability of the sector, but require significant investment in analytics, governance and reporting processes.

The RIS tightens requirements for the design, presentation and distribution of investment products, including investment policies, introducing stricter standards of transparency and adequacy. Insurers need to strengthen product governance, expand suitability assessments, and adapt informational materials to the new requirements, enhancing the safety and convenience of retail customers. The regulation is intended to reduce the risk of misselling and promote informed investment decisions.

In 2026, insurance companies are pursuing a key phase of implementations, including regular testing, business continuity, and advanced oversight of technology providers. The KNF publishes positions on the application of DORA, highlighting the importance of this regulation for the market. According to KNF’s announcements, DORA is one of the fundamental directions for strengthening the operational security of insurance companies.

The AML package, phased in across the EU in 2026, significantly changes the AML/CTF regime, expanding insurers’ obligations as obligated institutions. The 6th AML Directive (6AMLD) introduces more detailed procedural requirements, and the creation of a European supervisory authority (AMLA) means a new level of control over high-risk entities. The EBA’s sanctions guidelines, effective as of the end of 2025, require the development of advanced screening tools and transaction analytics.

The banking sector will face strong regulatory pressures involving both legal, technological and capital issues. Growing legal risks, particularly in disputes regarding consumer loans and WIBOR-based mortgages are significantly impacting the need to increase provisions and adjust product policies and sales processes.

Increasing regulatory costs resulting from the implementation of CRD VI/CRR III, which change the rules for risk assessment and raise capital requirements, are an additional burden, further limiting institutions’ balance sheet flexibility. At the same time, the new PSD3 and PSR are transforming the payment services market, increasing competition in open banking and forcing modernization of authorization systems and anti-fraud tools.

Banks, like insurers, are subject to DORA requirements, obliging them to build advanced operational resilience and centralize ICT risk management. Altogether, the implementation of 6AMLD, AMLA oversight and EBA guidelines significantly increase the requirements for transaction monitoring systems, data analytics and automation of KYC/CTF processes, raising compliance costs. This view of the sector is completed with increasing fiscal burdens. According to analyses of the Polish Bank Association, the increase in effective CIT could mean about PLN 7 billion of an additional burden for the sector, one of the most severe cost impulses in recent years.

Legislative work will continue in 2026 on a package of amendments to enable the reorganization of financial groups, including the division of insurance companies and their consolidation with banks. What is a key document, is a bill amending the Banking Law, the Insurance and Reinsurance Business Act and certain other acts of law (UD268), the provisions of which are intended to create a unified, legal framework for such processes.

Among other things, the bill envisages:

  • introducing detailed rules for the division of domestic insurance and reinsurance companies, possible only in the form of a joint-stock company, with mandatory supervision and approval of the KNF;
  • expanding opportunities for banks to merge with joint-stock companies belonging to the same group of companies, opening the way for the integration of banking and insurance structures;regulating transfers of insurance agents’ enrollments in dividing companies;
  • strengthening KNF’s licensing oversight and its assessment of financial risks and consumer protection during restructuring.

These changes will be crucial to the planned capital reorganization of PZU and Bank Pekao.

Factors specific to business segments

The PZU Group’s operations are shaped by external factors specific to its business segments, reflecting the different risk structures and competitive conditions in each sector. The most important of these are described below, broken down by each of the PZU Group’s business segments.

  • The greater number of cars and continued traffic may cause an increase in how often claims are made, and consequently an increase in the claims ratio, which will impact profitability of MTPL and MOD insurance;
  • High growth of new car sales in 2025, mainly in the dealership channel and financed by leasing companies, may result in higher sales of motor insurance;
  • Strong price competition in motor insurance and deteriorating result in MTPL and MOD will be reflected in different pricing strategies, thus affecting the market share levels in 2026;
  • Changes in trends and behavior of customers looking for personalized offerings and a fast, electronic way to conclude contracts and avail themselves of insurance service are forcing the need to adapt quickly to new expectations in order to maintain a competitive edge;
  • Climate change which result in, among other things, a greater range of crop species is grown by agricultural producers, which has a positive impact on crop rotation and biodiversity and may influence the development of subsidized agricultural insurance offerings;
  • Repeated and increasingly more unpredictable chance events, such as sudden floods, hail, torrential rains, hurricanes, tornadoes, droughts, and spring frosts, are contributing to increasing claims ratios in the non-life insurance sector;
  • Increase in sums insured: with perceived inflation and risk of underinsurance, companies and individual customers are updating sums insured, which leads to both an increase in insurance premiums and claims paid to ensure full restoration of lost or damaged property;
  • The growth of the construction industry, including the increase in infrastructure, mega-investments (nuclear power plant, wind farms in the Baltic Sea, Central Transport Port) and energy transition, in conjunction with the expected inflow of funds from with an expected influx of funds from the National Reconstruction Plan and EU funds for cohesion policy 2021-2027 expected to increase interest in contractual guarantees and construction insurance;
  • The development of non-motor insurance offerings by, among other things, providing customers with value beyond just insurance coverage may result in the further development of strategic partnerships between insurers and companies with large customer bases, as well as the creation of customer service ecosystems;
  • The increase in the use of technology and artificial intelligence (AI) will result in the rapid growth of the cyber-insurance market, with insurers focusing on offering comprehensive solutions that combine financial protection with prevention and incident response services;
  • Better use of data due to technological developments and the use of artificial intelligence (AI) will allow the creation of more precise offerings and a better adjustment of price to risk, consequently, building a competitive edge, both in compulsory and voluntary insurance.
  • An increase in mortality due to an aging population, and emergence of new epidemics or infectious diseases will contribute to an increase in claims and a reduction of the insurance portfolio (a decrease in the number of people insured);
  • Demographic changes and the aging society as well as the ensuing changes in the current mortality and fertility levels will lead to developing insurance offerings for senior citizens and higher demand for health and ;retirement insurance;
  • Price pressure, in particular in group insurance, and the competition for client ownership (and client data) might cut the insurer’s margins, reduces the scope (quality) of the product and fostering entry and exit obstacles for clients to overcome with independent intermediaries;
  • KNF’s implementation of its recommendations on insurance distribution will result in the need to better match product coverage to the real needs of customers, as well as to implement more rigorous supervisory and quality assurance processes throughout the distribution chain;
  • Increasing insurance awareness, changes in client trends and behavior toward personalized life insurance offerings may result in the development of individual insurance, while limiting the potential for the development of group insurance in its current formula;
  • Further expansion of private health care as a consequence of the realization of health debt, demographic changes, and the rise in popularity of health insurance;
  • Better use of data due to technological developments and the use of artificial intelligence (AI) will allow the creation of more precise offerings and a better adjustment of price to risk, consequently, building a competitive edge.
  • Geopolitical tensions, particularly the ongoing Russia-Ukraine war, which has a direct impact on the possibility of conducting insurance operations in Ukraine and on their results;
  • More intense and increasingly more unpredictable chance events, such as sudden floods, hail, torrential rains, hurricanes, tornadoes, droughts, and spring frosts, are contributing to increasing claims ratios in the non-life insurance sector;
  • Changes in trends and behaviors of customers seeking customized proposals as well as an electronic, swift conclusion of agreements and handling of insurance, force insurers to adapt to these new expectations rapidly;
  • Increase in insurance fraud cases as a result of the more difficult situation in numerous industries causing growing unemployment;
  • Introduction of an insurance tax in Lithuania – As of 1 January 2026, a 10% tax on premiums in nonlife insurance has been introduced, excluding compulsory motor third-party liability insurance for individuals. The tax will finance the state Defence Fund. The introduction of the tax may result in an increase in operating costs for insurance companies, consequently reducing their profitability and investment capacity. They may also lead to a decrease in demand in price‑sensitive segments
  • High demand for specialist physicians with an insufficient supply can slow the growth of medical facilities and squeeze their margins;
  • Inflationary pressures from partner establishments and wage pressures from medical staff may directly reduce PZU Zdrowie’s financial performance;
  • Rising salary expectations of staff, combined with increased demand for medical services, may lead to a reduction in the availability of services at the selected establishments, with staff which may prefer to work at establishments offering higher salaries;
  • Changing trends and growing customer expectations that require the personalization of offerings may force modifications to processes and systems, which affects the level of performance;
  • An aging population (declining fertility rates), rising mortality and morbidity rates, as well as the health debt after the COVID-19 pandemic, resulting from treatment of chronic diseases (including cardiovascular and oncological conditions) being postponed, may translate into an increase in health product claims;
  • The continuing pressure on price in group insurance limits the ability to sell new health products that are add-ons to group insurance policies;
  • Strong price and product competition in the medical services market affects the profitability of establishments operating in the health care segment;
  • High saturation of the market in large cities combined with staff shortages and limited customer potential in smaller localities may slow down the development of the health offering;
  • Changes in the valuation of outpatient specialty care services by the National Health Fund (NFZ) may significantly affect the performance of medical establishments;
  • Aggressive expansion of competing medical networks, especially in terms of the development of their own infrastructure, may in the long term limit patient acquisition opportunities and weaken the competitive position of PZU Zdrowie operators;
  • Pandemics or epidemics, whether new or similar to COVID-19, may have social and economic consequences leading to business restrictions, including on the operation of medical establishments, which can significantly reduce their performance.
  • The reduction in interest rates may have a positive impact on debt fund valuations, making them even more attractive to both institutional and individual customers;
  • The geopolitical and macroeconomic situation and the fiscal actions of the world’s central banks in terms of interest rates may translate into prosperity in the financial markets;
  • The stability of the regulatory environment, including potential amendments to laws, regulations and guidelines, as well as unanticipated modifications to pension, PPE and PPK regulations, may affect the growth prospects and performance of the segments;
  • The pace of economic growth in Poland, as well as the condition of listed companies, may affect the performance of equity and mixed-profile funds;
  • The financial situation of the customers may affect their willingness to invest, due to, among other things, increased debt service costs with continued elevated inflation and high interest rates.
  • The climate on the capital market (in particular on the Warsaw Stock Exchange, which is affected by both the geopolitical and macroeconomic factors) may shape the value of the funds’ assets, and the level of fees collected by pension fund companies for management;
  • Legislative work and regulatory efforts concerning the third pillar of the pension system may have an impact on improving its efficiency and making it more attractive to participants;
  • Strengthening public awareness of the need for additional retirement savings;
  • Changes in tax laws, particularly those related to capital gains tax, may affect segment performance;
  • The growing negative balance of cash flows between OFEs and ZUS resulting from the entry into the “zipper” mechanism of the vintages of fund members with the highest volume and those with the largest accumulated capital. This phenomenon will significantly affect the level of assets managed by Open Pension Funds.

The main factors that could affect the scale and profitability of PZU Group’s banking operations in 2026 include:

  • The tax and-regulatory environment, including the change in the CIT rate, the existence of a tax on certain financial institutions, high equity requirements, contributions to Bank Guarantee Fund (BFG), and costs of adjustments to numerous regulatory solutions (e.g. MIFID II, GDPR, PSD II, MREL);
  • The economic situation in the European Union, which impacts, among others, the scale of exports of Polish companies;
  • The level of demand for banking services reported by individual and institutional customers;
  • The institutional environment and potential rulings by the CJEU, the Supreme Court and other state authorities, especially regarding mortgage loans denominated in foreign currencies, free credit sanctions, cash loans or consumer rights protection;
  • Possible implementation of government schemes to support the housing market, which can stimulate lending;
  • Progressive consolidation and restructuring of the banking sector, affecting its structure and competitiveness;
  • Reform of the benchmark index, i.e., the replacement of WIBOR with a new index;
  • Development of banking services offered by nonregulated entities, increasing competition in the sector;
  • The pace of the implementation of EU-funded projects, especially under the National Recovery Plan, affecting investment and financial activity;
  • Reductions in interest rates, which have been historically high until 2025, may cause interest margins to fall.

Internal factors

Internal factors affecting the PZU Group’s operations are determined primarily by the PZU Group Strategy, the PZU Group’s Capital and Dividend Policy, and the capital reorganization project announced in December 2024.

In the area of operations, priority is given to initiatives aimed at eliminating technological debt, implementing a new sales system in which the various channels are complementary, rather than competitive, and increasing the efficiency of the claims handling process.

  • New IT architecture to deploy more AI-based tools;
  • A new front-end system to support all sales models while maintaining the specific nature of each distribution channel;
  • A new model of cooperation with multiagencies, which will also maintain the strong position of tied agents, including a simplified and predictable remuneration system, access to PZU’s advanced tools and significant investment in MTPL/MOD tariffs, which will increase the competitiveness of the offering and support sales growth;
  • Expanded cooperation with banks, which will include the development of bancassurance offerings to include products aimed at the small and mediumsized enterprise (SME) segment.
  • Development of the mojePZU platform to intensify customer interaction (refreshing the interface, improving intuitiveness, streamlining user paths, expanding the range of services) and further strengthen the direct channel;
  • Decision on LINK4’s role and position in the PZU Group, expected in Q1 2026;
  • Upgrade for the claims handling system to improve process efficiency and customer experience;
  • Improvement of risk tariffication and segmentation processes, increasing the pricing precision and flexibility in adjusting offerings, which is key to maintaining a competitive edge;
  • In the area of life insurance – making the full range of offerings and processes available in digital channels, especially in the area of individual continuation (IK), as well as developing products geared to the silver and middle-age generations to better match the offerings to market needs;
  • In the area of health – developing self-service functions in digital channels, standardizing patient pathways and expanding the company’s own network of establishments to strengthen PZU’s position as a leader in comprehensive insurance and protection products.

The PZU Group’s capital and dividend policy for 2025- 2027 directly shapes its long-term growth strategy through the capital structure, investment opportunities and level of capital security. Under this policy, up to 20% of profit is allocated to organic growth and innovation, while the remainder can be used for dividends or other capital needs.

The following factors will be important in 2026:

High solvency (Solvency II ratio at the end of Q3 2025 at 234%1) and high return on equity (20.7%)2 create a solid base to continue paying high dividends into 2026.

The implementation of an internal risk model (compliant with Solvency II requirements) planned for the first half of 2027 will optimize the PZU Group’s capital position. This solution should have a positive impact on the further development of the business and enable the continuation of the current dividend policy in 2027, even without the capital reorganization of the PZU Group (see below).

Continued efforts related to the transformation of the Group into a holding structure may allow an increase in the regulatory capital of the new banking and insurance group by PLN 15-20 billion (under the socalled Danish compromise). This could translate into faster growth for both PZU and the Group’s banks, increase their ability to participate in major economic projects.

1.In accordance with EIOPA’s position 25/135 ‘Supervisory Statement on the Deduction of Foreseeable Dividends from Own Funds under Solvency II’ of January 2025, starting from Q1 2025, own funds are reduced— for the purposes of interim supervisory reporting—by 80% of the consolidated result of the PZU Group attributable to PZU shareholders.
2.Solvency II figure as at 30.09.2025, ROE as at 31.12.2025

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